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M/s. Bharat Steels Versus The Commercial Tax Officer

2015 (4) TMI 610 - MADRAS HIGH COURT

Reversal of Input tax credit - variation with references to purchases made - supplier has not paid the tax collected by them - Held that:- the selling dealer had not paid the collected tax. The liability had to be fastened on the selling dealer and not on the petitioner-dealer which had shown proof of payment of tax on purchases made. The orders were liable to be set aside. That sub-section (16) of section 19 states that the input-tax credit availed is provisional. It however, does not empower t .....

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of 2015 & M.P.Nos. 1 to 1 of 2015 - Dated:- 1-4-2015 - S.Vaidyanathan J. For the Appellant : Mr.P. Rajkumar For the Respondent : Mr.Kanmani Annamalai ORDER Mr.Kanmani Annamalai, learned Additional Government Pleader (Taxes) takes notice for the respondent. 2. The petitioner has come forward with these writ petitions, challenging the orders of the respondent dated 02.03.2015. 3. The learned counsel for the petitioner submitted that the petitioner's place of business was inspected by the Enfor .....

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5. 4. The learned counsel for the petitioner further submitted that the reasons given by the petitioner was not accepted on the ground that the petitioner had made excess input tax credit on the purchase whereas the sellers have reported less sales in their returns and the time sought for is only to drag on the matter. 5. The learned counsel for the petitioner further contended that the petitioner's vendors were all registered dealers on the file of the department and the same was available .....

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s follows:- ". The mere fact that the Department had not made an assessment on the dealer's vendor, per se, could not stand in the way of the assessing officer considering the claim of the dealer under section 19 of the Act. Going by section 17 which provided that the burden on the purchasing dealer rested to the extent of showing that he was not liable to tax under the Act and read in the context of the fact that the petitioner-dealer had given his sellers' TIN number and had also .....

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collected by them to the State. Without taking recourse to that, the Department could not deny the claim of the petitioner". 7. The learned counsel for the petitioner also relied on another decision of this Court in the case of Sri Vinayaga Agencies vs. Assistant Commissioner (CT) Vadapalani I Assessment Circle, Chennai and Another reported in [2013] 60 VST 283 (Mad), wherein, it is held as follows:- ".Section 19(1) states that input-tax credit can be claimed by a registered dealer, if .....

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tened on the selling dealer and not on the petitioner-dealer which had shown proof of payment of tax on purchases made. The orders were liable to be set aside". so also the decision rendered by this Court in W.P.Nos.25996 to 25998 of 2014 dated 17.10.2014, wherein this Court, by referring the above two decisions, in paragraph Nos.5 and 6, has held as follows:- "5.This Court in the case of Althaf Shoes P. Ltd., Vs.Assistant Commissioner (CT), Valluvarkottam Assessment Circle, Chennai -6 .....

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iles of the Department, the claim of the dealer for refund could not be rejected nor delayed. The mere fact that the Department had not made an assessment on the dealer's vendor, per se, could not stand in the way of the assessing officer considering the claim of the dealer under Section 19 of the Act. Going by Section 17 which provided that the burden on the purchasing dealer rested to the extent of showing that he was not liable to tax under the Act and read in the context of the fact that .....

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take necessary action against the vendors, who had not remitted tax collected by them to the State. Without taking recourse to that, the Department could not deny the claim of the petitioner. 6.In the light of the above decision, the observation made by the respondent in the impugned order is wholly unsustainable. Further in the case of Sri Vinayaga Agencies Vs. Assistant Commissioner (CT), Vadapalani-I Asssessment Circle, Chennai and Another reported in (2013) 60 VST 283 (Mad), this Court held .....

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tax due on such purchase has been paid by him in the manner prescribed and that was accepted at the time when the self-assessment was made. The pre-revision notices and the orders clearly stated that the petitioner-dealer had paid the tax to the selling dealer. If that be the case, the petitioner's case squarely fell under the proviso to section 19(1) of the Act. It was another matter that the selling dealer had not paid the collected tax. The liability had to be fastened on the selling dea .....

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